Property investors and landlords will be able to deduct the new Local Property Tax from their rental income when filing a tax return.
At present the non-principal private residence (NPPR) tax and the household charge are not allowed as expenses when landlords are workout out their profit as part of a tax return.
However, according to The Irish Independent Minister for Finance Michael Noonan has confirmed that the property tax may be treated differently. He said he intends to amend the new legislation to allow the tax to be treated as an expense for landlords.
The move would ease the burden on buy-to-let investors, many of whom are struggling to meet mortgage repayments.
Commenting on the matter, Minister Noonan said: “The Thornhill Group recommended that the local property tax paid in respect of a rented property should be deductible for income tax or corporation tax purposes, in a similar manner to commercial rates.
“This is not provided for in the Finance (Local Property Tax) Act 2012 but it is the intention of the Government to introduce such a provision on a phased basis.”